Nxt-ID files for spin-off of Fit Pay payments and authentication business with SEC
Nxt-ID has filed a Form 10 Registration Statement with the U.S. Securities and Exchange Commission to begin the process of spinning off its payments, authentication, and credential management business, Fit Pay. The name of the new company has been revealed as PartX, Inc.
The spin-off was originally announced in September, but was delayed when Nxt-ID was unable to reach terms with its primary lender about the release of security interest in assets covered under the proposed spin-off. The split is now expected to proceed as expected, with shares in the new company distributed to Nxt-ID shareholders in a tax-free distribution.
“This filing marks an important next step in the planned spin-off of our Fit Pay, Inc. (“Fit Pay”) subsidiary and our payments business,” said Chief Executive Officer Gino Pereira. “The spin-off will create two independent companies focused on delivering significant ongoing value to our shareholders within their respective markets.”
PartX will include Fit Pay assets from the company’s 2017 acquisition, along with payment, authentication, and credential management assets previously developed by Nxt-ID. The intended benefits of the spin-off include enhanced strategic and management focus on the core of each company, more efficient capital allocation and improved access to capital, improved investor understanding of business strategy, and enhanced investor choice.
“This spin-off will enable both companies to execute business plans that leverage their core strengths and to present clear, well-defined value proposition for our shareholders, partners and customers,” said Michael Orlando, COO of Nxt-ID, president of Fit Pay, Inc. and incoming Chief Executive Officer of PartX, Inc. “This more singular focus, along with a more concentrated and efficient use of resources, will fully empower both companies to maximize shareholder value.”
Fit Pay’s Token Requester Platform is the flagship offering of the new company, as one of the first successfully commercialized token requester services integrated with major card networks. PartX will also develop secure, connected devices for digital payments and loyalty programs, which will be offered directly to consumers through distribution partnerships.
The spin-off is expected to be completed in Q2, following approval by the Nxt-ID Board of Directors and other standard conditions. Following the proposed spin-off, Nxt-ID plans to continue trading on the Nasdaq Capital Market, while PartX has applied to list on OTC Markets Group’s OTCQB.